Archive For "July, 2009"

7-31-09

5:02a GMT – Here we are, end of the week, end of the month! Time goes too quickly.. Yesterday’s signal for a 1.4115 short was never entered as no candlestick confirmation signal every occured. Looks like we might get one any bar here though, as the price action appears to be stalling out near 1.4125. Otherwise I am looking to reset short near 1.4150 now as the RSI would be oversold on 1hour, slow stock would be flipped and dipping below overbought, and on the 4-hour the RSI would be at resistance and the slow SS would be ready to flip in overbought territory.

Trading Idea: looking to reset short near resistance at 1.4150, with targets at 1.4105, 1.4070, 1.4005 and eventually 1.3955.

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7-30-09

3:06a GMT – All short targets were hit from Monday’s signal (sell 1.4275, tp 1.4130) and the USD/CAD signal is currently about 90 pips in the profit. With the EUR/USD we saw quite a significant surge in the USD as traders began taking profit on their riskier positions and returning to the safety of the dollar. Possibly driving this was the Eurozone’s decision to begin taxing Chinese imports on steel, which I believe to be net negative for the Euro and positive for the dollar. I am looking to reset my shorts on the Euro for a challenge of rising daily trendline support (yellow line at bottom of chart), currently around 1.3925.

Trading Idea: Looking for overbought conditions near resistance around 1.4115 for shorts. Targets down to 1.4075, 1.4015, 1.3055.

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7-28-09

4:06a GMT – I don’t normally do USD/CAD signals on PipHut but the USD/CAD is at major daily/weekly support and I thought I would share with everyone. On 4hour we are well oversold with a bullish divergence on the RSI and the slow stoch has just started to the upside. Unfortunately this has been the condition with the USD/CAD for days now and the downtrend has continued. Different this time though, is the daily chart. On the daily chart we can see we are on support that got a 1000 pip bounce last time it hit there. RSI and slow stoch are both oversold on the daily.The weekly confirms this, BUT the RSI on the weekly has not hit 30 (though does have a slightly bullish divergence from the support last time) and the slow stoch has not crossed over (though the stoch line is at 4! highly oversold).

Trading Idea: Long USD/CAD with target at below 23.6% of fib retracement, curently around 1.0640.

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7-28-09

3:14a GMT – Pair continued to stay in its tight range yesterday. We saw a brief spike to just below 1.4300 yesterday but it was quickly tempered by a fast 100 pip drop. We do have a bearish divergence in the 4h RSI, but the slow stoch is nearing oversold levels as well, so the trade is not confirmed. I am looking for a little bit of a further drop to get the slow stoch to oversold levels, then a rise back up for a good alignment of slow stoch and RSI at overbought levels, while price action is near resistance on 4 hour charts for a sell opportunity.

Trading Idea: Looking for slow stoch to return to overbought levels just as RSI touches yellow resistance and price hits resistance near 1.4275. Short targets at 1.4215, 1.4170 and 1.4130. Would consider buying on a dip to oversold on the slow stoch if price is near support as well, in the short-term.

(click to enlarge)

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7-27-09

3:56a GMT – Here we are, about to start another week, almost at the end of July. Time really flies doesn’t it? Just a little reminder to everyone to take a little time out now and again to take a walk, spend some time with your family, do something fun just for yourself. Life is too quick for all business! Anyway, on to the signals!

I wanted to pull a weekly chart for us to look at as we enter this new week to get some perspective on the recent price action, which has seen the dollar lose a lot of strength in the past week and then range with Euro. As you can see from the chart below in 2005 the EUR/USD was just beginning its ascent to all time highs around 1.60 that we saw in late 2007 and early 2008. In the end of 2008 we saw an extremely large drop (over 3500 pips) in just 4 short months. This drop occured as extreme risk-aversion entered the market, investors took money out of the carry-trade and other investments and sought the relative safety of the US dollar. Since then it has been a story of risk-aversion as investors battle positive news with general market jitters and the desire for more risk.

Currently the pair is hovering just above the 50% retracement of the major drop in 2008, and also just below the declining trendline of the 9/21/08 and 12/14/08 highs. You can also see that the slow ss is just about to enter overbought on the weekly, while the RSI is slightly overbought at 60.8. It is for these technical reasons that I remain generally bearish, though I think the EUR/USD has a little bit of room to increase until we see a little more overbought levels. The big key is to watch economic news coming out of the US and Eurozone. Positive news will lend itself to more risk and a spike in the Euro.

(click to enlarge)

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7-24-09

2:45a GMT – It doesn’t get much more picture perfect then yesterday’s signal – the pair gave us long upward wick followed by a bearish engulfing candlestick – two major reversal signs. If that wasn’t enough we had a bearish divergence on both the RSI and Slow Stoch. All targets were hit within 4 hours. But that was yesterday. On to today! After the major rally in the USD we saw the pair bounce off of oversold on the RSI, just touching 30 before rallying back up. I will continue to be bearish on the pair and look for selling opps near resistance.

Trading Idea: Resistance at 1.4165 and 1.4200 is the closest. As the candlesticks have been good signals so far I will look for a candlestick confirmation signal, and also divergences in the RSI and Slow Stock on 60m. Targets back down to 1.4165, 1.4115, 1.4085 and 1.4055.

(click to enlarge)

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7-23-09

3:45a GMT – Candlesticks have led the way for the past couple of days, at least on the 60M charts. On the hourly below I’ve circled in light blue all of the major candlestick reversal signals near resistance or support. Doji, hammers, engulfing – all of them have led the way for major swings in direction. On a larger scale the major resistance, now just below 1.4250 continues to hold but just barely. RSI is mildly overbought and the Slow stoch is rolling over from overbought on the 60M. My overall bias is bearish as long as that resistance holds. Will look for candlestick signals to enter more trades.

Trading Idea: Look for candlesticks to confirm trade, bearish below 1.4250 with targets at 1.4200 and 1.4160.

(click to enlarge)

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7-22-09

5:00a GMT – Even though I’m a trend-follower and the trend definitely appears to be going up for the EUR/USD recently I am selling this resistance. The resistance is very strong, have held twice over the past year (red line at the top of the cart below), and the pair is near overbought on the 4h and daily charts, with the daily slow stoch rolling over from overbought after posting  a bearish doji reversal candlestick right at the resistance.

Trading Idea:  Selling on bearish candlesticks near resistance at 1.4250 or on a clean break of 1.4150. Targets at 1.4150, 1.4105, and 1.3975.

(click to enlarge)

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7-20-09

4:06a GMT – Decided to back it out to the daily charts for an analysis as we head into the week to get a wider perspective on some of the recent market movements. As you can see in the chart below at a glance the pair has major highs in place in December of 2008 and June of 2009. The pair is currently trading close to the upper trendline resistance of those two highs. We also appear to have very solid support in place around 1.2400 that has been tested several times over the past year. More recently we have seen a symmetrical triangle consolidation (upper trendline is red diagonal, lower is yellow) take place between the lows and highs since June of 2009. Starting on July 8, 2009 we have seen a possible consolidation movement between 1.3830 and 1.4200 (parallel yellow lines).

Trading Idea: With such strong resistance lines (daily and hourly confluence) I will look to sell overbought on the RSI (over 70) with supporting SS. However, in the short-term I also expect strong support around 1.4100 and 1.4050 so you could probably catch pips off of a bounce of these support levels if that was your trading style.

(click to enlarge)

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7-16-09

4:49a GMT – No trade entered yesterday as the EUR/USD charged quickly through our resistance, never giving us reason to sell (don’t stand in front of a freight train!) with a bearish confirmation signal. Even on the shorter time frames it hardly hesistated. Big money apparently threw risk-aversion to the wind yesterday as US stocks rallied sharply for the 6th consecutive day and the value of the dollar plummeted. Current technical charts show the pair bounced hard off the channel top that is parallel to the channel bottom support after becoming extremely overbought. General signals are mixed as the pair currently has a lot of room for more downside as well as more upside. Support is seen around .14050 and resistance at 1.4140. Below 1.4050 look for a re-test of 1.4015 and 1.3975.

(click to enlarge)

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